Microsoft Blows Away Expectations

Steve Ballmer

Microsoft just reported EPS of $0.51 on sales of $16.04 billion for Q2, blowing away expectations.

The company beat revenue expectations in each division except for Online Services, where it reported sales of  $565 million and a $696 million operating loss.

Microsoft had an operating loss of $172 million in the Entertainment and Devices division, which is home to Xbox and mobile.

In the release, Microsoft said it sold 175 million copies of Windows 7 since it launched last fall.

This is a very solid report from Microsoft. It probably won’t get the monkey off Steve Ballmer’s back, because the company still doesn’t have a good story to sell compared to Apple. Losses in the mobile and online divisions aren’t good.

Regardless, this is reminder that Microsoft can deliver. It also puts off any questions about Apple delivering bigger quarterly revenue than Microsoft.

Here’s how Microsoft did compared to the Street’s expectations:

  • Revenue: $16.04 billion versus $15.3 billion expected.
  • Operating Income: $5.9 billion versus $5.3 billion expected.
  • EPS: $0.51 versus $0.46 expected.

Revenue estimates by division:

  • Windows and Windows Live: $4.55 billion versus $4.3 billion expected
  • Server and Tools: $4.01 billion versus $3.8 billion expected
  • Online Services: $565 million versus $582 million expected
  • Business Division: $5.3 billion versus $4.97 billion expected
  • Entertainment and Devices: $1.6 billion versus $1.52 billion expected

See Also: Microsoft Celebrates 30 Years Of Ballmer: Here’s A Few Highs And Lows From His Decade As CEO

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